[Chapter 586: The Real Estate Developer]
The plans for White Plaza are massive, particularly since it doesn't really welcome foreign investment. The number of shareholders is extremely limited. This time, the assets being sold by the Kuwaiti Investment Authority included the White Plaza project.
Talk about bad luck -- when it rains, it pours. Just as they offloaded shares at a bargain price, the U.S. decided to encourage real estate investments. There are hardly any projects for White Plaza in the U.S.; beyond what local folks care about, Wall Street giants are still oblivious to this place.
To them, Las Vegas and Atlantic City seem much more worthwhile for investment. It seems like the savvy William White has been going around in circles. What's so great about Los Angeles and San Francisco? One's just an entertainment capital that doesn't allow gambling, while the other is prone to earthquakes, and aside from some IT companies, there's really nothing else.
The subsequent projects are even more ridiculous -- Houston and Miami lack decent big corporations. Seriously, running such a huge project there is laughable. The only place worth investing in is New York, but progress has been painfully slow. It seems like they're tearing down two floors for every one they build.
"Boss, the U.S. is encouraging real estate now. Shouldn't I invest a bit?"
"Forget about San Francisco, Jason. If you're going to buy, it's better to look at Beverly Hills. But, buddy, there are property taxes. You can have one to live in and another to rent out, max."
"Really? I thought property values were skyrocketing. Now that Japan is down and out, the capital has to come back to the U.S."
"Dude, if you're in real estate development, that could work; there's a lot of money to be made. Buying a building to wait for appreciation? Not so much. Japan's prices have already dropped by 20%, and they're still not selling."
"Oh, got it."
"Actually, don't you hold stocks in Microsoft and Coca-Cola? Plus shares in MTV? Buddy, your investment portfolio is pretty solid."
"Okay, I'll take your advice. I'm just worried it'll go crazy like the Japanese market did."
"Hahaha, what are you kidding? How much land do they have compared to the U.S.? The biggest issue is that land there is mostly in the hands of small landowners, making it difficult to buy extensive plots. In the U.S., those holding land are corporations. In any case, the real estate market in the U.S. isn't going to explode. At least not in a way that's anywhere near as exaggerated as that Japan's."
William White knows that hoarding properties in the U.S. is basically a joke. You either develop commercial real estate or sell your homes as fast as you can.
For guys like Jason Garrison, it might be better to invest in Australia. When the subprime mortgage crisis hits, housing prices won't have risen much.
If there's a place with the most outrageous price increases, without a doubt, it's Hong Kong. In fact, developing countries have all seen outrageous increases. This is due to uneven income distribution--rich folks feel that a $3 million home is just too embarrassing.
As for the poor?
Who cares?
However, those annual rents at thirty to fifty times the property price can't last forever.
Take the example of Japan. An apartment that was worth two or three million dollars ended up being worth only three or five hundred thousand dollars.
In fact, if property prices crash, those who can't afford homes will still be unable to buy. If things fall apart badly, then you'll really need to worry about unemployment. If you've lost your job, it doesn't matter how cheap houses are.
...
"What do you think about the White Plaza project?"
"I don't know. Our firm, Goldman Sachs, got a late start in Asia. The market there is really hot; those guys love real estate."
"Hmm, Richard, how did the talk with William go?"
"Not bad. Haha, I think we can't go back to how it used to be."
"Sigh, we're in big trouble. If the White Plaza goes public, it'll be no less than Tesla. How did this guy switch to real estate?"
"Real estate? I think he wants to invest in everything. Didn't he consider selling that oil company when it was losing money?"
"Ha, he probably hasn't lost money for a while. It's just a pity that his plans aren't fully realized."
...
Goldman Sachs is eyeing him, and JPMorgan is doing the same. When you've got something in hand, it's easy to take it for granted. It's only when it's gone that you realize the heartbreak.
"What? Are you sure?"
"Yes, sir. They discovered large amounts of iron ore in a town called Christmas Creek. According to inside sources, this town is built on a massive iron plate."
"Damn it, we need to hurry up."
"Yes, sir. William White found out a few days ago and has been keeping quiet. Who knows who he's planning to dupe next?"
"Ugh, if that's the case, he's not going to lose out. If he discovers one or two more mines..."
...
The consortium has a clear understanding of the direction of war. Saddam is done for, beyond recovery. They're completely certain that the war has entered garbage time.
Facing three broken lines of defense, if the soldiers can't deal with it, then they might as well stay home. The outside world is too dangerous -- just not suitable for them.
The war end may still be some time away, but now's the time to strategically position themselves.
Washington plans to roll out policies to encourage consumption, with real estate at the forefront.
There are just so many industries tied to real estate; once real estate consumption picks up, everything else will flourish.
As for that damned Star Wars project, let's put that on hold. If there are no big spenders to foot the bill, America isn't interested in playing either. If you can't handle the Scud, the situation with the Soviets and the Satan missile is even more helpless.
Taking out rocket boosters isn't simple; if the warhead separates too early, honestly, you won't even get a whiff of it.
Since missile defense systems are unreliable, it's better to focus on economic development. If the economy goes to shambles, the Soviets will certainly face dire consequences.
Reinforced concrete?
Fine, but that's not used much. Americans mainly build their villas with wood. Selling that won't make much profit.
As for home appliances and cars, cough, it seems like it's all dominated by the Japanese products. The consortium sadly realizes that the economic stimulus benefits are not coming back to America.
Increasing fiscal deficits and expanding trade deficits. No, we still need to print more dollars.
A new wave of inflation is brewing; a pack of greedy wolves is scheming to plunder the world.
Stop them?
Haha, you're just asking for trouble.
...
William White is frustrated because he sees no way to benefit from it. Not only that, but he'll also be indirectly helping those jerks.
That bastard is always so touchy; people are practically going crazy from jealousy. No one expected that even before the White Plaza went on sale, parts of the mall already had tentative contracts. Even the five-star hotel already found a partner.
In the face of such a mature business environment, what's there to be unhappy about? If there's any dissatisfaction, it's just with the pricing.
William White doesn't have anything cheap on his hands. The more amenities there are, the steeper the price. Those big eggs of his have rental prices among the highest in the nation.
A group of corporates was astonished to discover that William White hasn't just started dealing in real estate -- he's been at it for a long time. It's just that his assets were so massive that you didn't pay much attention.
This is just the investment in the U.S.; William White's investments in Asia far exceed those in America. It seems like, for the short term, this inflation isn't going to catch up with him.
*****
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